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Advice: Discover Card sent letter "Attorney Placement Pending"

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Due to surprise heart attack last sept, have limited self-employment income & big medical expenses + husband unemployed. Hanging in & able to pay for current living expenses/medical/prescription. But, stopped making credit card payments on Discover Card with balance of just under $14k (mine), Citibank $16k (husband), GE Capital $3100 (husband).  Until now we've not answered any calls or letters. Citi & GE accounts have been charged-off. Discover shows 120+days past due. We know that this will negatively affect our credit and we'll live with that. No need for bankruptcy as we are paying mortgage & 2nd, car loan almost paid off & current, credit card issued by our bank is being paid on-time. Just figured that they'd all charge-off and eventually stop trying to collect. But, have been doing a lot of reading on-line and it appears that we'll likely be sued so maybe being pro-active with settlement might be a better game plan.

 

Last week received letter by usps priority mail (not certified) from Discover Card. Titiled "Attorney Placement Pending". Says they are going to proceed with Legal Action if we don't hear from you by July 31 and acct will be forwarded to attorney to obtain a judgement against you. To stop action call immediately to make acceptable payment arrangements. Call now before your time expires. Sincerely XXXXX, Cardmember Assistance, Discover Card.

 

What to do now? 

Do I call Discover card and discuss settlement? (I can come up with $3-4000)
Do I send a Debt Validation letter?
I know that Citi & GE have sent the account to collection agencies but we've never taken their calls and I haven't saved their letters.
Will it eventually get sent back to OC and they sue us?
When to discuss settlement with Citi & GE?
 
Thanks so much for any help
 

 

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Write Discover Bank and tell them you wish to begin arbitration against them.

http://www.jamsadr.com/

http://www.creditinfocenter.com/community/topic/314030-the-strategy-and-steps-of-arbitration/

THIS

MEANS IF EITHER YOU OR WE CHOOSE ARBITRATION,

NEITHER PARTY SHALL HAVE THE RIGHT TO

LITIGATE SUCH CLAIM IN COURT OR TO HAVE A

JURY TRIAL. ALSO DISCOVERY AND APPEAL RIGHTS

ARE LIMITED IN ARBITRATION.

 

 

 

http://www.consumerfinance.gov/credit-cards/agreements/search/?q=discover+bank

Agreement to arbitrate. If a dispute arises between

you and us, either may choose to resolve the dispute

by binding arbitration, as described below, instead of

in court. Any claim (except for a claim challenging the

validity or enforceability of this arbitration agreement,

including the Class Action Waiver) may be resolved

by binding arbitration if either side requests it. This

includes claims and disputes relating to any other

Account or agreement you have or had with us. THIS

MEANS IF EITHER YOU OR WE CHOOSE ARBITRATION,

NEITHER PARTY SHALL HAVE THE RIGHT TO

LITIGATE SUCH CLAIM IN COURT OR TO HAVE A

JURY TRIAL. ALSO DISCOVERY AND APPEAL RIGHTS

ARE LIMITED IN ARBITRATION.

Governing Law and Rules. This arbitration agreement

is governed by the Federal Arbitration Act (FAA).

Arbitration must proceed only with the American

Arbitration Association (AAA) or JAMS. The rules

for the arbitration will be those in this arbitration

agreement and the procedures of the chosen arbitration

organization, but the rules in this arbitration

agreement will be followed if there is disagreement

Fees and Costs. If you wish to begin an arbitration against

us but you cannot afford to pay the organization’s or

arbitrator’s costs, we will pay those costs if you ask us in

writing. Any request like this should be sent to Discover,

PO Box 30421, Salt Lake City, UT 84130-0421. If you

lose the arbitration, the arbitrator will decide whether

you must reimburse us for money we advanced for you

for the arbitration. If you win the arbitration, we will

not ask for reimbursement of money we advanced.

Additionally, if you win the arbitration, the arbitrator

may decide that you are entitled to be reimbursed

your reasonable attorneys’ fees and costs (if actually

paid by you).

 

 

 

 

 

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Do I call Discover card and discuss settlement? (I can come up with $3-4000)
Try it it won't hurt, Discover is infamous for suing so it's better to settle, but you can learn how to win by the time they do it, if they do it, also for the amount is a big number and more likely for them to do something about it, specially if you got your house almost paid off and they can place a lien on it.
 
Do I send a Debt Validation letter? No, that's for JDB's or CA's not OC
 
I know that Citi & GE have sent the account to collection agencies but we've never taken their calls and I haven't saved their letters.
Start saving all letters. Citi might sell it ot not, GE will likely sell it to a JDB.
 
Will it eventually get sent back to OC and they sue us?
Likely with Discover, less likely with Citi, and unlikely with GE.
 
When to discuss settlement with Citi & GE?

After you're done with Discover, try Citi first, but they are infamous for not having good records.

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Citi Bank has arbitration also.

http://files.consumerfinance.gov/a/assets/credit-card-agreements/txt/creditcardagreement_6072.txt

 

ARBITRATION
RESOLUTION OF DISPUTES BY ARBITRATION: THIS SECTION CONTAINS IMPORTANT INFORMATION REGARDING YOUR CHECKING PLUS (VARIABLE RATE) ACCOUNT AND THE SERVICES RELATED THERETO.  IT PROVIDES THAT EITHER YOU OR WE CAN REQUIRE THAT ANY DISPUTES BE RESOLVED BY BINDING ARBITRATION. ARBITRATION REPLACES THE RIGHT TO GO TO COURT, INCLUDING THE RIGHT TO A JURY TRIAL AND THE RIGHT TO PARTICIPATE IN A CLASS ACTION OR SIMILAR PROCEEDING. IN ARBITRATION, THE DISPUTE IS SUBMITTED TO A NEUTRAL PARTY, AN ARBITRATOR, INSTEAD OF A JUDGE OR JURY. ARBITRATION PROCEDURES ARE SIMPLER AND MORE LIMITED THAN RULES APPLICABLE IN COURT.

Agreement to Arbitrate Disputes. Either you or we may elect, without the other’s consent, to require that any dispute between us concerning your Citibank deposit, Checking Plus, Checking Plus (variable rate), Custom Credit Line, or Ready Credit accounts, except those disputes specifically excluded below, be resolved by binding arbitration.

Disputes Covered by Arbitration. Any claim relating to or arising out of your Citibank deposit, Custom Credit Line, Ready Credit, Checking Plus (variable rate), or Checking Plus account, or our relationship will be subject to arbitration. All disputes are subject to arbitration, no matter what legal theory they are based on, or what remedy (damages, or injunctive or declaratory relief) they seek.  Disputes include any unresolved claims concerning any services relating to such account, including, without limitation, safe deposit box services, wire transfer services, and use of a Citibank Banking Card or Citibank Banking Card displaying the MasterCard logo. Disputes include not only claims made directly by you, but also made by anyone connected with you or claiming through you, such as a joint account holder, account beneficiary, employee, representative, agent, predecessor or successor, heir, assignee, or trustee in bankruptcy.  Disputes include not only claims that relate directly to Citibank, but also its parent, affiliates, successors, assignees, employees, and agents, and claims for which we may be directly or indirectly liable, even if we are not properly named at the time the claim is made. Disputes include claims based on any theory of law, contract, statute, regulation, tort (including fraud or any intentional tort), or any other legal or equitable ground, and include claims asserted as counterclaims, cross-claims, third-party claims, interpleaders or otherwise; and claims made independently or with other claims.  A party who initiates a proceeding in court may elect arbitration with respect to any dispute advanced in that proceeding by any other party.  Disputes include claims made as part of a class action, private attorney general or other representative action, it being expressly understood and agreed to that the arbitration of such claims must proceed on an individual (non-class, non-representative) basis and the arbitrator may award relief only on an individual (non-class, non-representative) basis.  Disputes also include claims relating to the enforceability or interpretation of any of these arbitration provisions.  Any questions about whether disputes are subject to arbitration shall be resolved by interpreting this arbitration provision in the broadest way the law will allow it to be enforced.

Disputes Excluded from Arbitration. Disputes filed by you or by us individually in a small claims court are not subject to arbitration, so long as the disputes remain in such court and advance only an individual (non-class, non-representative) claim for relief.

Commencing an Arbitration. The arbitration must be filed with one of the following neutral arbitration forums and follow its rules and procedures for initiating and pursuing an arbitration: American Arbitration Association or JAMS. If you initiate the arbitration, you must notify us in writing at Citibank, Litigation/Arbitration Unit, One Court Square, 43rd Floor/Zone 10, Long Island City, NY 11120. If we initiate the arbitration, we will notify you in writing at your last known address on file. You may obtain a copy of the arbitration rules for these forums, as well as additional information about initiating an arbitration by contacting these arbitration forums:

American Arbitration Association
1-800-778-7879 (toll-free)
Website:  www.adr.org
    

JAMS
1-800-352-5267 (toll-free)
Website:  www.jamsadr.com
 

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Ge has arbitration also

 

PLEASE READ THIS SECTION CAREFULLY. IF YOU DO NOT REJECT IT, THIS SECTION WILL APPLY TO YOUR ACCOUNT, AND MOST

DISPUTES BETWEEN YOU AND US WILL BE SUBJECT TO INDIVIDUAL ARBITRATION. THIS MEANS THAT: (1) NEITHER A COURT NOR A

JURY WILL RESOLVE ANY SUCH DISPUTE; (2) YOU WILL NOT BE ABLE TO PARTICIPATE IN A CLASS ACTION OR SIMILAR PROCEEDING;

(3) LESS INFORMATION WILL BE AVAILABLE; AND (4) APPEAL RIGHTS WILL BE LIMITED.

• What claims are subject to arbitration

1. If either you or we make a demand for arbitration, you and we must arbitrate any dispute or claim between you or any other user of your account,

and us, our affiliates and agents if it relates to your account, except as noted below.

2. We will not require you to arbitrate: (1) any individual case in small claims court or your state’s equivalent court, so long as it remains an individual

case in that court; or (2) a case we file to collect money you owe us. However, if you respond to the collection lawsuit by claiming any wrongdoing,

we may require you to arbitrate.

3. Notwithstanding any other language in this section, only a court, not an arbitrator, will decide disputes about the validity, enforceability, coverage

or scope of this section or any part thereof (including, without limitation, the next paragraph of this section and/or this sentence). However, any

dispute or argument that concerns the validity or enforceability of the Agreement as a whole is for the arbitrator, not a court, to decide.

• No Class Actions

YOU AGREE NOT TO PARTICIPATE IN A CLASS, REPRESENTATIVE OR PRIVATE ATTORNEY GENERAL ACTION AGAINST US IN

COURT OR ARBITRATION. ALSO, YOU MAY NOT BRING CLAIMS AGAINST US ON BEHALF OF ANY ACCOUNTHOLDER WHO IS

NOT AN ACCOUNTHOLDER ON YOUR ACCOUNT, AND YOU AGREE THAT ONLY ACCOUNTHOLDERS ON YOUR ACCOUNT MAY BE

JOINED IN A SINGLE ARBITRATION WITH ANY CLAIM YOU HAVE.

If a court determines that this paragraph is not fully enforceable, only this sentence will remain in force and the remainder will be null and void, and

the court’s determination shall be subject to appeal. This paragraph does not apply to any lawsuit or administrative proceeding filed against us by

a state or federal government agency even when such agency is seeking relief on behalf of a class of borrowers, including you. This means that we

will not have the right to compel arbitration of any claim brought by such an agency.

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Is there an example of a request to arbitrate letter?

Do I send the letter to the Discover address at the top of the letter they sent? 

Or do I send the letter to the address in your post and include a request that they pay up-front arbitration cost?

Discover,PO Box 30421, Salt Lake City, UT 84130-0421

 

Do I need to initiate the arbitration and register with JAMS? 

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http://www.creditinfocenter.com/community/topic/314030-the-strategy-and-steps-of-arbitration/  the strategy and steps in arbitration. click on the link

This was done by Linda7 who is an arbitration expert read thru it and you will have a better understanding of how to use arbitration to defeat your creditor.

 

1.Is there an example of a request to arbitrate letter? yes on the link posted above.

2.Do I send the letter to the Discover address at the top of the letter they sent? Discover Bank PO Box 30421, Salt Lake City, UT 84130-0421

 

3.do I send the letter to the address in your post and include a request that they pay up-front arbitration cost? yes and yes

4. Read the strategy and steps of arbitration first.

5. linda7 has examples of all forms needed on the link posted above.

6.Read the jams rules on the jams website.

7.http://www.jamsadr.com/ jams web site

8.Don't rush take a couple of days to study - you have plenty of time to learn and send your letters.

 

Don't get scared lots of people here have had 3 to 6 cases going on at once if you have questions just post it up and someone will come and reply to your post.

 

Note you do not have to arbitrate against any of the Banks listed it is just an option available to you from your credit agreement.

 

You can fight the creditors in court if you wish we have some great CA people who love to win cases in court.

http://www.creditinfocenter.com/community/topic/320243-going-to-trial-in-california/ read this case on this link.

 

http://www.leginfo.ca.gov/.html/ccp_table_of_contents.html THE CODE OF CIVIL PROCEDURE OF CALIFORNIA

http://california-discovery-law.com/ this is for discovery

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Is there an example of a request to arbitrate letter?

Do I send the letter to the Discover address at the top of the letter they sent? 

Or do I send the letter to the address in your post and include a request that they pay up-front arbitration cost?

Discover,PO Box 30421, Salt Lake City, UT 84130-0421

 

Do I need to initiate the arbitration and register with JAMS? 

Read the post that racecar listed, but you wouldn't initiate arbitration until you're sued.  

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Thanks for all the info. I'm reading thru the strategies & steps of arbitration. Its a lot of info and a little confusing at first. I thought that I had to initiate the arbitration before being sued and that if they reach the point of suing me then arbitration went out the window.

 

So, I don't have to choose arbitration right now. I can wait until they sue?? 

 

In the meantime, can I call them and negotiate a settlement? Is that the best step to take right now?

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With arbitration there are two different things:  election and initiation.  They are not the same.

 

Election means choosing.  By electing arbitration, you choose that method to resolve any disputes between you and the creditor.

 

Initiating is actually filing the paperwork with the arbitration forum, such as JAMS.

 

I would recommend electing arbitration before they sue you.  By doing that, you have made it a tortous act if they do sue you.  And a  violation of FDCPA for their CA, and of CA's Rosenthal Act for the OC.   You are drawing a line in the sand, and woe to them if they cross it.

 

If they do sue you, you can file a motion to compel arb and a stay pending arb in court.  Then you initiate arb with JAMS.

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You can never predict how any one creditor will respond to a default...sometimes they just write off the debt and walk away from it. The letter you received is a legal threat which may or may not be a scare tactic. A real legal threat is when you get served a summons by a sheriff or process server. 
- Don't waste your time offering $20 a month....they don't want it. 
- The best way to handle this would be do settle for less up front if you could get the funds somehow...like offering to settle for $500. Get all terms in writing first if you do this. If you don't have any money to do this, then you'll just have to wait and see what they do. I would encourage to inform them that you're a self employed baby sitter who is making a low wage. This "may" discourage legal action. 
- If they do take legal action, show up in court...not showing up is the worst thing you can do.

For more information, please contact Utah Bankruptcy Attorneys.

 

Thanks

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I disagree.  Typically when Discover sends this letter "attorney placement pending", they really do mean it.  It happened to me.  And yes, they did sue.  I elected to eventually settle.  Electing arbitration is an interesting idea, but I don't know how well it works.  Do your research.

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